Wanda Increases Price Tag On Theme Park Sale, Adds Second Buyer

China’s Dalian Wanda Group has altered its proposed deal to sell off theme parks and 77 hotels to Sunac China, which was announced last week. It has since upped the price tag and switched buyers for its hotels after local banks scrutinized the company’s credit risk.

In a joint announcement Wednesday, Wanda said it was bringing Guangzhou R&F Properties into the deal and would sell the company its 77 hotels for $2.95 billion, a sale previously planned to go to Sunac China. Wanda was still selling a total of 91% equity in 13 tourism projects to Sunac, but the price tag was hiked from $4.29 billion to $6.34 billion on Wednesday. Wanda also said that it would no longer look to arrange vendor financing to aid Sunac with deal.

This brings the total price tag of the updated deal to $9.4 billion – up slightly from last week’s figure of $9.3 billion – still making it what is believed to be the second-largest property deal ever in the Middle Kingdom. Sunac has already paid its first installment in the purchase of $2.17 billion, according to a joint statement from the three companies.

Wanda’s Wang Jianlin told a press conference in Beijing, “All three parties are winners. Wanda is definitely a winner, through this transfer [we will] lower debt significantly and collect a large amount of cash.”

Related Story

Last week, Wanda made the surprise announcement that it would sell off 77 hotels and 91% of 13 tourism projects to developer Sunac for $9.3 billion. At the time, Wanda did not give a reason for the sale, but Wang told Chinese financial daily Caixin that funds will be used to reimburse most of Wanda’s bank loans, resulting in an “asset-light” operation.

On Monday, Chinese financial regulators apparently ordered the country’s biggest banks to stop making loans to Wanda to finance foreign entertainment acquisitions. Last week’s announcement also saw credit firms flag risks to Sunac’s debt profile after the company said it would seek a loan from Wanda to pay for the theme parks.

Guangzhou R&F is a midsize property developer in China that owns soccer team Guangzhou R&F F.C. The company did not say whether it would take a loan to purchase the hotels from Wanda.